The Reserve Bank of Australia is now just months away from offering government customers real-time access to its systems, after deciding on a provider for its new API-based integration solution.
The central bank recently entered a $2.4 million deal with Indian IT outsourcer HCL to provide the integration service that is being pitched to improve how transactional banking services are provided to government.
The cloud-based managed service contract follows a year-long search for a solution to securely expose information from the bank’s internal business applications.
The bank currently provides 90-odd government agencies with banking services, including processing bulk electronic direct credit and direct debit transactions relating to welfare and Medicare rebates.
But until now these agencies have had to rely on a web service - parts of which date back to when the RBA first started using web links decades ago - to gain access to their data with the bank.
Information is not always pushed through to government automatically, and often requires agencies to manually search for the data.
With the new API, government agencies will be given more flexibility to manage data, as well as information associated with that data, that they have with the bank.
“The intention is that the government will be able to get access to that data in real-time, which will be helpful for them,” RBA Assistant Governor Lindsay Boulton told iTnews.
“For example, if they are making a welfare payment, they’ll be able to get access to information that tells them that the payment has been made successfully through an API.”
While the solution will be available for all government customers, Canberra’s two biggest services agencies – the Department of Human Services and the Australian Taxation Office – are the ones expected to use it mostly heavily.
“The Department of Human Services has a strong use case and will likely be our first customer to access the service,” Boulton said.
Boulton also indicated that the Department of Finance would find the API useful for “overseeing and managing the flow of payments and information around payments across different government agencies”.
“That will enable them to get more real-time data on how those flows are going so they can manage the government’s cash position a little bit better,” he said.
Drives NPP adoption
The API will also work hand-in-hand with the new payments platform (NPP), which Finance is keen to adopt to transform the decades-old financial practices used to manage public funds, particularly for real-time emergency welfare money or disaster payments.
The NPP allows for real-time payments between financial institutions and their customers, and has been a project of both the financial services industry and government since early 2012.
The intention is for the API to provide access to information, while actual payments will be made through the NPP, Boulton said.
“Essentially the API will give them the information that they need and enable them to do the analysis, and then they’ll be able to use the NPP on the back of that analysis,” he said.
The solution's scalable nature also means that the API could be used for the central bank’s other customers – such as overseas central banks – at a later stage.
Boulton indicated the bank was excited about the cloud-based managed service that will see HCL manage the integration service, including SLAs and any required upgrades, allowing the bank to focus its efforts elsewhere.
“We do have cloud services for other things, but this is probably stepping up to another level,” he said.
The API will be up and running and ready for testing in February 2019, ahead of the completion of the bank’s new core banking system mid next year.